Report Advocates for progress Tax reforms to enhance education funding

In March, 2025,  ActionAid International Uganda launched a significant report advocating for progressive tax reforms to enhance funding for education. The report launch took place at Fairway Hotel and was attended by various civil society organizations, consultants, and officials from the Ministries of Finance and Education.

Samuel Ntale, a Project Coordinator at ActionAid International Uganda(AAIU), remarked, “The current taxation system is intended to generate revenue for the education sector. However, it is regressive. We are hopeful that by implementing different systems, such as taxing the informal sector, the government can raise additional revenue.”

Although education financing in Uganda has increased over the past decade in response to population growth, demand for education, and the need for improved infrastructure and teacher welfare, public expenditure on education as a percentage of Gross Domestic Product has averaged at 2.04% over the last decade.

A key finding of this study is that the system is mostly regressive since the majority of tax is collected through indirect taxation, and there is therefore a need to strengthen more progressive forms of revenue generation. Progressive taxation is only effective if compliance is enforced to combat tax evasion, tax avoidance due to tax exemptions, and weak tax administration.

Julius Akiiki, an economist at the Ministry of Finance, highlighted significant tax challenges, particularly in the informal sector. He stated, “We are currently witnessing a decline in the informal sector, which has traditionally been difficult to tax. With the implementation of reforms, we are establishing more industries that will reduce imports and create more jobs.”

Follow the link to get details on the report: https://uganda.actionaid.org/publications/2023/progressive-tax-reforms-…